Sohu Climbs as Factory Data Fuels Weekly Rally: China Overnight

By Belinda Cao -
Dec 14, 2012

Chinese stocks rallied in New York,
stoking the biggest advance in the benchmark index in three
weeks, as data signaling manufacturing is expanding boosts
prospects Asia’s largest economy is emerging from its slowdown.

Manufacturing in China grew for the second month, according
to a preliminary reading for December of a purchasing managers’
index compiled by HSBC Holdings Plc and Markit Economics. The
result, which exceeded the median economist estimate, comes
after reports this week showed factory output and retail sales
climbed in November. The Shanghai Composite Index (SHCOMP), which has
lost 26 percent in the past seven quarters as China’s economy
slowed, soared the most since 2009 yesterday.

“Anyone who’s looking at China’s numbers, even the PMI
yesterday, will have to see that it’s definitely turning the
corner,” Chris Bertelsen, chief investment officer of Global
Finance Private Capital, which manages $1.7 billion in assets
including emerging-market stocks, said by phone yesterday from
Sarasota, Florida. “This recovery will be durable and long
lasting. China will be our leading investment in emerging
markets in 2013.”

The Hang Seng China Enterprises Index (HSCEI) climbed 1.5 percent
yesterday and 3.6 percent in the week to a nine-month high of
11,307.42, while the Shanghai Composite jumped 4.3 percent to
2,150.63, the steepest one-day rally since October 2009. The
gauge also rose 4.3 percent in the week.

The December preliminary reading was 50.9 for a purchasing
managers’ index released today by HSBC Holdings Plc and Markit
Economics. That compares with the 50.8 median estimate in a
Bloomberg News survey of 12 economists and a final reading of
50.5 for November, the first time in 13 months it was above the
expansion-contraction dividing line of 50.

More Debt

Suntech climbed 8.3 percent to $1.04, the highest since
Sept. 21, the second-biggest gainer on the index of U.S.-listed
Chinese stocks. The stock capped a 17 percent rally this week,
the most in six weeks.

LDK Solar Co. (LDK) jumped 7.7 percent to $1.26, the highest
price since Sept. 27. The solar company, which owes more than
$3.1 billion, is seeking consent from noteholders to take on
more debt. The company will offer noteholders 10 yuan ($1.60)
for every 10,000 yuan they hold in its notes due in 2014,
according to a filing today.

SolarCity Corp. (SCTY), the solar power provider led by
billionaire Elon Musk, jumped 47 percent after raising $92
million in an initial public offering.

“Chinese solar companies are benefiting from SolarCity’s
IPO and strong debut trading,” Aaron Chew, a senior analyst
with Maxim Group LLC, said by phone from New York yesterday.
“You have a successful solar IPO for the first time in years.”

‘Notorious Markets’

Sohu jumped 3.4 percent to $42.24 after its website was
removed the “Notorious Markets” list, the Office of the U.S.
Trade Representative said in a Dec. 13 report. Sohu’s Sogou site
reportedly made “notable efforts” to reduce inclusions of
infringing content, it said. Jiang Xin, a spokeswoman for Sohu,
declined to comment on the report.